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Fraudulent Activity In A Bankruptcy Case, Whom Do I Notify If There Is Possible Fraud?

A) Contact the Office of the United States Trustee - The Office of the U.S. Trustee is the place to start when reporting possible fraudulent activity in a bankruptcy case. Fraudulent activity may have been committed by a debtor, an insider of a debtor, a creditor, a trustee, an attorney or other professional, or a bankruptcy petition preparer. Fraudulent activity may include hiding assets, fraudulently transferring property, lying under oath, knowingly filing false affidavits or declarations, knowingly filing false proofs of claim, or knowingly providing false information.

B) What to Include in the Letter - To expedite the handling of complaints of violations in the bankruptcy system, the U.S. Trustee requires that the complaint be submitted in a signed letter with the following information:

  • Your return address and telephone number;
  • The bankruptcy case name and file number;
  • Copies of any pertinent court filings;
  • A chronological summary of the allegedly fraudulent activity;
  • A statement as to why you believe that fraud has occurred;
  • Location of property alleged to be involved; and
  • Names, addresses, and telephone numbers (to the extent available) of the witnesses known to you.

C) Mail the letter to:
Office of the United States Trustee
Special Investigations Unit
915 Wilshire Boulevard, Suite 1850
Los Angeles, CA 90017

D) U.S. Trustee Review and Response - If the information furnished establishes a reasonable belief that a criminal violation has occurred, the matter may be referred to the United States Attorney. If the United States Attorney deems the matter to hold prosecutorial merit, it will be referred to the appropriate law enforcement agency for investigation. Occasionally a debtor or trustee is sentenced to prison for fraudulent activity. Sometimes the activity does not rise to the level of criminal activity but provides justification for the court to order the return of property to the bankruptcy estate, the denial of a discharge of debts for the debtor, or the removal of a trustee. In any event, dishonest activity is taken very seriously by the bankruptcy court and Office of the U.S. Trustee.

FAQ Type: 
After Filing Bankruptcy